Factors Impacting Loan Defaults: The Case of Thai SME Loans in Bangkok Metropolitan Region

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วิชญ์พล คุ้มกัน
กุลบุตร โกเมนกุล


This paper aims to investigate factors impacting on bank loan defaults of Thai SME enterprises in Bangkok and the Bangkok Metropolitan Region. The authors focus on enterprises who are normal debtors, and have credit limit for business in
the types of long-term loan and overdraft. We obtain data on Thai SMEs including enterprise’s characteristics, financial performance, credit information, types of loans, types of industry and loan default information. The samples in this study are totally 592 enterprises, covering the period of 2013 to 2015. We apply a logit model with control variables such as loan types, industries and bank loan regions. Using panel logit regression, our results show that about 17% of the entire sample has bank loan defaults. We find that SMEs default on long-term loans at a higher rate than SMEs with overdraft (OD). Additionally, size of bank loan (credit limit) and enterprise’s age are negatively related to the likelihood of bank loan defaults.


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